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The company said U.S. net sales tumbled 13% to $852 million, while international revenue declined 9% to $447 million. Direct-to-consumer revenue jumped 18% to $315 million.

“It is important that we return to positive growth, particularly in our core U.S. business, and the steps we are taking as we execute against our long-range strategic plan should put us in a position to achieve this,” A&F CEO Mike Jeffries said in a statement.

Looking ahead, A&F projected full-year EPS of $2.15 to $2.35 on a high-single digit decline in same-store sales and a 20% jump in direct-to-consumer sales. Analysts had been calling for EPS of $2.33.

Meanwhile, A&F said its board of directors approved a $150 million accelerated share repurchase to be executed during the first quarter. The buybacks are on top of existing authorization of 16.3 million shares.

Shares of New Albany, Ohio-based A&F rallied 4.61% to $37.65 in premarket trading on Wednesday. While A&F has gained 9% so far in 2014, it remains down 21% over the past year.

Earlier this week, activist shareholder Engaged Capital nominated a slate of five candidates to the A&F board.

"For far too long, stockholders have suffered under the failed leadership of a board that has lacked the independence necessary to properly act as our fiduciaries,” Glenn Welling, chief investment officer at Engaged Capital, wrote in a statement.